Federal Levas Rates Steady, Still Expect to Cut in 2026

 The Fed kept the federal funds rate unchanged at 3.5%–3.75% for the second straight meeting in March 2026, which is pretty much what everyone expected. They said the economy is still growing at a solid pace, but job gains have slowed and inflation is still a little higher than they want. There’s also uncertainty from the situation with Iran, which makes it harder to predict where things are going next. Even with that, the Fed is still planning for one rate cut later this year and another in 2027, though they haven’t locked in the timing yet.

They also updated their outlook and are slightly more optimistic on growth. GDP is now expected to grow 2.4% in 2026 and 2.3% in 2027, both a bit higher than earlier projections. Unemployment is expected to stay pretty stable around 4.4% in 2026 and 4.3% in 2027, which suggests the labor market is holding up even with slower hiring. At the same time, inflation is still a concern—both PCE and core PCE are now projected at 2.7% for 2026, which is higher than what they previously thought.

Overall, the Fed is in a tricky spot. The economy is doing well enough that they don’t want to cut rates too quickly, but inflation is still above target, so they can’t ease policy aggressively either. That’s why they’re staying cautious—keeping rates steady for now while signaling small cuts in the future if inflation starts to cool and uncertainty (like global conflicts) settles down.

Why Gas Prices Are So High Right Now

If you've filled up your tank recently, you've probably noticed it hurts a lot more than it used to. Gas is averaging almost $3.88 a gallon right now, which is the most we've paid in over two years. The big reason? The war involving the U.S., Israel, and Iran has messed up oil shipping routes in the Middle East, especially through the Strait of Hormuz. That's caused oil to shoot up past $105 a barrel, which is about $32 more than last year. Less oil getting through means higher prices for all of us, and it happened fast, gas jumped almost 27% in just one month.

It's not just gas, either. When oil gets expensive, basically everything else does too because it costs more to ship stuff around. The government is trying to help by releasing emergency oil reserves and approving new drilling projects, but none of that is going to bring prices down overnight. Until the situation in the Middle East calms down, we're all just going to be paying more at the pump.

 Gas prices are rising. Here's why and what drivers can expect next — CU Boulder Today, March 19, 2026

Markets now see the Fed’s next move as a potential rate hike as inflation fears mount

 The markets are quickly changing experts' expectations on the Federal Reserve due to the anticipation of rising inflation. The oil prices have now reached over $90 a barrel, adding pressure to other costs throughout the economy, making it even more difficult for inflation to return to 2%. The result of this is that traders are expecting another rate increase. Energy prices at the moment are proving the chance of the Federal Reserve keeping interest rates high or even increasing them more for now. 

U.S. Inflation is Heading Much Higher Than the Fed Expected

     A report from the OECD that has just come out projects that U.S. inflation will hit 4.2% this year, this is much higher than the Fed's original estimate of 2.7%. This gap is mainly be driven by the war in Iran which is disrupting the oil flow from the Strait of Hormuz. Since the Middle East is so important to the global oil supply, the risk of a long-term war has already pushed oil prices past $100 a barrel. This has made everything more expensive for both producers and consumers.

    A big concern is that the Fed may be too optimistic and we end up with higher interest rates for a much longer period than expected. The length of the war in Iran could have a big impact on the housing market and negatively affect mortgage demand. It seems as though all progress that was made on decreasing inflation has been erased by the conflicts in the Middle East.

Source: https://www.cnbc.com/2026/03/26/global-forecasting-group-sees-us-inflation-at-4point2percent-this-year-much-higher-than-fed-estimate.html

Iran War Negotiations and Their Impact on the Global Economy

 Geopolitics and economics share the same bloodstream. The U.S.-Iran standoff makes that impossible to ignore. Trump claims talks are progressing. Tehran says no formal negotiations exist at all. That contradiction isn't just diplomatic noise. Markets don't wait for verified facts. When two sides tell completely opposite stories, uncertainty itself becomes an economic force worth watching.

Oil feels the pressure first. The Strait of Hormuz accounts for about a fifth of the world's oil supply. Even rumors of confusion cause prices to lurch. No blockade needed. The threat alone breeds volatility. Economists call this a negative supply shock. Constrained output pushes prices up and those higher costs bleed into nearly every corner of the economy. The shipping and manufacturing and retail sectors depend on energy resources. When those inputs get pricier, firms pass the cost along. Households end up paying more for the same goods which leads to increased expenses. Real purchasing power quietly erodes. Businesses eyeing expansion tend to freeze when the geopolitical weather looks stormy. Why pour capital into a project when the ground might shift next week?

Financial markets cut both ways though. When whispers of a possible deal surfaced recently, oil prices dipped and equities climbed. A single unconfirmed report moved billions in value within hours. That sensitivity reveals something worth noting. The global economy reacts not just to events but to the anticipation of events. No resolution is visible on the horizon yet. Until clarity arrives, volatility stays baked in. This situation shows how thoroughly politics threads through inflation, investment and growth, even before anything concrete actually happens.

https://www.cnbc.com/2026/03/24/trump-iran-war-negotiations.html

U.S. Cancels Offshore Wind Projects in $1 Billion Deal

 The U.S. government has agreed to pay nearly $1 billion to TotalEnergies to cancel two offshore wind projects planned along the East Coast. Originally intended to expand renewable energy production near New York and North Carolina, the projects were scrapped as part of a broader shift in federal energy priorities. TotalEnergies is now expected to redirect its investment toward oil and natural gas development within the United States.

The move has sparked debate across the energy sector. Supporters believe it will strengthen access to reliable and affordable energy, while critics argue it represents a setback for clean energy progress and a costly use of taxpayer money. The decision highlights the ongoing tension between expanding fossil fuel production and investing in renewable energy for the future. 

https://www.cnbc.com/2026/03/24/us-to-pay-totalenergies-1-billion-to-kill-east-coast-wind-projects.html

The UK and the War in Iran

The whole world has watched the combat between the US and Iran unfold over the past few weeks. This war has affected the economic situation of many countries. One such country is the UK where a national emergency meeting has been called for Monday, March 23, to discuss the situation. The UK’s government is borrowing at their highest level since the 2008 financial crisis. The economic situation is only getting worse as threats are exchanged between the US and Iran. Iran has threatened to attack the water and energy systems of surrounding countries if the US attacks Iran’s energy grid. The UK is facing higher and higher prices since they rely on exported natural gas and fuel. This, along with other economic difficulties, is pushing down the value of British bonds. 

In the upcoming meeting, the issue of how to react to these challenges will be discussed. The Finance Minister has already stated that she believes it is too soon to know what the impact of the war will be and is resisting major actions. The Housing Minister is voicing concerns about “profiteering” from fuel companies and would like to discuss ways to fight this. 

Britain has been facing difficulties with inflation, and the shock to the energy market caused by this war is making this problem far worse. Some economists project that the inflation rate could reach 5% this year. Just last week the government issued a support package to help households whose heat runs on oil. It is now expected that the Bank of England will raise interest rates due to the war (they were projected to make cuts before the conflict). The government is in a difficult position as inflation rises but many call for increased governmental support. 

The recent conflict may be mainly between the US and Iran, but its effects are worldwide. This article only looks at the UK but these effects are being felt throughout the world and are an important aspect of this war which must be considered. 

https://apple.news/AwNGdZd6JQty5oUNFYcc9RQ

The spring housing market is on, but mortgage rates just shot higher. Here’s what to know.

     The housing market this spring has been different than we have normally seen. spring is one of the most popular times to buy a home and there are many homes on the market. But the thing is there aren't more homes on the market because more people are selling homes, its because the homes are taking longer to sell. One of the main reasons being that mortgage rates have gone up by about 6.5% this makes payment for homeowners more expensive. Even though the home prices aren't rising that much the reason for people not buying homes is the increase in interest rates. Builders of homes are also struggling because the cost to make a home has gone up and their final products are taking much longer to sell. Overall because of these higher interest rates its making it harder for producers and consumers when it comes to producing and purchasing a home. 

source: https://www.cnbc.com/2026/03/20/spring-housing-market-mortgage-rates.html

Can We See The End?

     Oil prices ended this past week still above $100 a barrel. With President Trump claiming to have made progress on the Strait of Hormuz, we might finally see a fall in prices. 

    President Trump claims to have given Iran 48 hours from Saturday night to open the Strait of Hormuz for passage. At this point in time, there has not been any sort of movement allowed through the passage. The talks to open the Strait mean that we are more than likely not to see the end of the war in Iran. Ex-Energy Secretary Dan Brouillette says he believes we will see a drop in oil prices in the coming weeks.

    With gas prices staying above $3.50 across most of America, citizens cannot keep up with the prices for much longer. The war in Iran may end in 2 days or 2 years; no one knows. The US government must find a way to lower these prices to keep citizens across the nation from falling behind financially. 

https://www.axios.com/2026/03/22/iran-war-oil-trump-hormuz-strait-threat 

Agricultural and Market Price Volatility (World Economic Forum)

 The war is driving up not just energy prices but also markets for key agricultural inputs like fertilizers, because petrochemical products travel through the same routes affected by the conflict. This has contributed to higher food prices globally, adding inflationary pressure in both developed and developing economies. 

Commodity markets have become more volatile as traders price in the risk of long‑term supply disruption, and countries dependent on energy and food imports face larger fiscal and balance‑of‑payments challenges. This combination of cost pressures and uncertainty can slow global demand and compress economic growth prospects.

source : https://www.weforum.org/stories/2026/03/the-global-price-tag-of-war-in-the-middle-east/?utm

Business and Supply Chain Risks (Reuters / Thomson Reuters)

 

Analysts say the conflict has created the potential for a “dual‑chokepoint” shipping crisis, where disruptions in both the Strait of Hormuz and other Middle East sea routes could significantly slow global trade. Higher insurance costs, freight rate spikes, and rerouting of maritime traffic are already driving up the cost of shipping goods ranging from energy to manufactured products. 

These bottlenecks and logistical challenges increase uncertainty for businesses and reduce efficiency in global supply networks, which can lead to slower investment and production as firms adapt to higher risk and cost structures. This could weaken profits and slow growth in sectors dependent on imported inputs.

source : https://www.thomsonreuters.com/en-us/posts/corporates/iran-war-economic-business-impact/?

1. Impact on Asia’s Economy and Global Growth (Time)

 

The war’s economic effects extend beyond energy markets into broader regional economies, especially in Asia, where many countries import large amounts of oil and gas from the Middle East. Rising energy prices and disruption to trade routes could slow industrial activity, hurt growth, and push inflation higher in Asia, which would then ripple through global supply chains and trade balances. 

Higher prices for fossil fuels and the knock‑on effects on food and transportation costs are also straining household budgets and corporate margins, making it harder for central banks to balance inflation and growth concerns. This could lead to slower global economic expansion as countries deal with costlier inputs and weaker trade performance.

source : https://time.com/article/2026/03/16/us-israel-iran-war-trump-asia-economy-oil-energy-inflation-recession/?

The stakes are enormous: how a prolonged Iran war could shock the global economy Richard Partington

 The article explains that what many initially viewed as a short‑lived conflict has already driven oil prices above $100 a barrel and doubled European gas costs, creating heightened inflation and financial market volatility. Central banks and governments worldwide are warning that sustained energy price shocks could slow growth, hurt industries, and raise living costs, making everyday things like petrol, flights, and fertilizers significantly more expensive. 

A key concern is the disruption of the Strait of Hormuz, through which about one‑fifth of the world’s oil normally flows; if it remains effectively blocked, supplies of oil, gas and critical petrochemical products could tighten further. The article highlights that rising energy and supply chain pressures could ripple into food and manufacturing sectors, dragging down global growth and underscoring how fragile and interconnected the global economy is in the face of geopolitical shocks.

https://www.theguardian.com/news/ng-interactive/2026/mar/22/iran-war-global-economy-donald-trump-oil-prices-inflation?

Are the rich helping us stay out of a recession?

 

The idea of a “K-shaped” economy has become popular since COVID-19, suggesting that the recovery has mainly benefited the rich while lower-income groups have fallen behind. This raises concerns that economic growth depends too heavily on high-income households, meaning a drop in their spending could hurt the entire economy. While this seems believable, especially with claims that the top 10–20% account for a large share of spending, the article argues that these conclusions are based on questionable data. For example, estimates from Moody’s Analytics rely on assumptions about income and savings behavior that may not accurately reflect how people actually spend.

When looking at more reliable data, like surveys from the Bureau of Labor Statistics and analysis from Barclays, the story changes. These sources show that higher-income households make up closer to one-third of total spending, and that share has remained fairly stable over time. Other indicators also don’t support a strong divide; spending growth, wage increases, and consumer confidence are relatively similar across income groups. Overall, while inequality in the U.S. is still an issue, the idea that the economy is being driven only by the wealthy seems exaggerated, making the “K-shaped” recovery more of a catchy concept than a reality.

https://www.economist.com/finance-and-economics/2026/03/08/would-america-be-in-recession-without-the-super-rich